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Methods for Work Integration Social Enterprises Measuring Their Impact in a Public Context

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Methods for Work Integration Social Enterprises Measuring Their Impact in a Public Context State of the art in social impact measurement: methods for work integration social enterprises measuring their impact in a public context Abstract: Social entrepreneurship and the third sector at large have gained a considerable momentum over the past two decades. Stemming from private initiatives, this phenomenon found a positive echo in the public sphere through the political reforms enthused by new public management and their attempt to inject market-inspired mechanisms into public administration. Social enterprises are therefore progressively being recommended as a key lever for governments to focus on in the currently challenging economic context. While picking up on the enthusiasm for social enterprises, governments are also interested in measuring their social impacts, which happens to fit particularly well in the new public management’s paradigm and its evaluation requirements. Going from this observation, this article focuses on work integration social enterprises (WISEs), a well-identified subset of social enterprises. It first goes through a history of social impact measurement before establishing a review of the existing social impact measurement methodologies to date, focusing on the ones relevant for WISEs in a public management context. It then proposes a framework to categorize these methodologies using a new public management lens, while highlighting some of the limits of such an undertaking. 1. Introduction: Contribution and scope of this paper 1.1. Outlining the contribution of this paper Social enterprises have gained a considerable momentum in the policy arena in the past few years (Dees & IMF, 2012; European Commission, 2013), where they have been recommended as a key lever to focus on in the current economic context (European Commission & OECD, 2013; OECD, 2010). This is especially true for WISEs, for which the mission of integration through employment translates into a potential for affecting macroeconomic indicators (OECD, 2013; Sibieude, 2010). This interest for social enterprises also sprung concerns for a better understanding of impact they generate (G8, 2014). Provided the amount of work produced by third sector operators and their funders in that direction, public organisations are tempted to tap into the ever-expanding list of impact measurement methodologies already available. While this wealth of new tools dedicated to social impact measurement undoubtedly brings new perspectives to the field, one may consider how transferrable methods having been developed to assess philanthropic investments and raise private capital are to the policy making field. The report issued by the G8’s Social Impact Investment Taskforce in September 2014 provides a very pertinent illustration of this question: it identifies five types of actors in the social investment arena, governments (as outcome payer) being one of them. It then summarises the different needs each of these actors may have when measuring impact (chart D, p. 31) through 14 measurement types arranged in three families (cost of the issue, intervention metrics and investor metrics). While the Taskforce thereby clearly highlights that different stakeholders will document impact through different data, it also singles out governments as the one kind of actor that has impact documentation expectations across all 14 identified areas. We therefore propose to investigate this question by elaborating an analytical grid to frame impact measurement methodologies applicable for work integration social enterprises (WISEs), a well-defined subset of social enterprises, in a public management context. This paper is part of a PhD thesis aiming to investigate the ways public actors can measure the social impact of WISEs. The reflections developed here will build a foundation to carry out case studies in different European countries. 1.2. Defining the scope of this paper There is no consensus in academia or among practitioners on the definition of the term “social enterprise”. Looking at the literature, social enterprises are often outlined through the definitions of social entrepreneurship (Light, 2008; Mair & Martí, 2006), which revolve around social value creation through innovation (Dees et al. 1998; Roberts & Woods, 2005) and 1 social value creation through market mechanisms such as earned income strategies (Sagawa & Segal, 2000; Yunus, 2006). The EMES network synthesises these approaches by adopting a set of indicators in three areas (social, economic and governance) rather than a concise definition (Defourny & Nyssens, 2012). While there is a debate on the means of social enterprises, their end seems to reach a consensus around the notion of social value creation. Social value creation therefore appears core to the definition of social enterprises (Hart et al., 2010). However, similarly to the term “social enterprise”, the notion of social value does not have a consensual definition. Emerson et al. (2001) summarise this issue adequately by highlighting that “[social value] has intrinsic value, but can be difficult to agree upon or quantify”. Austin et al. (2006) associate social value with increased public good. The British parliament has adopted a rather precise definition of social value: “Social value is the additional benefit to the community from a commissioning/procurement process over and above the direct purchasing of goods and services”, from a working definition of the National Health Society (2009). This paper acknowledges the existence and the relevance of a debate around the definition and measurement of social value (Austin et al., 2006; Gibbon & Dey, 2011; Mulgan, 2010; J. Nicholls, 2007; Tuan, 2008). Rather than characterising social value, this paper’s scope is about the ways the creation of social value can be assessed, regardless of how this value is outlined. Instead of choosing a definition for social value, which literature suggests should be left to the stakeholders concerned by the assessed activity (Emerson et al., 2001; Tuan, 2008), we will choose a definition for social impact: “Social impacts include all social and cultural consequences to human populations of any public or private actions that alter the ways in which people live, work, play, relate to one another, organize to meet their needs, and generally cope as members of society” (Burdge & Vanclay, 1995, 59). With this definition in mind, we stress that Maas and Liket highlight the interchangeable use of the terms “social impact”, “social value creation” or “social return” often observed in academia and among practitioners (2011). In this state of the art, we will focus specifically on the social impact measurement methods that can be applied to work integration social enterprises (WISEs). Davister et al. (2004, p. 3) propose one of the most detailed definition of a WISE: “WISEs are autonomous economic entities whose main objective is the professional integration – within the WISE itself or in mainstream enterprises – of people experiencing serious difficulties in the labour market. This integration is achieved through productive activity and tailored follow-up, or through training to qualify the workers.” This definition will be used as a filter to select the methods that should be considered in this state of the art. While the retained definition suggests a focus on “professional integration”, Davister et al.’s paper identifies four modes of integration in WISES (2004, p. 4): transitional occupation, creation of permanent self-financed jobs, professional integration with permanent subsidies and socialization through a productive activity. We highlight the fourth mode of integration, which clearly indicates a focus on outcomes related to social inclusion and social integration, beyond the workplace, where work activities act as a catalyser. This consideration is core when assessing the social impact of WISEs, which extends beyond professional integration stricto sensu. Focusing on the well-framed WISE concept brings the benefit of mitigating some of the difficulties arising from the lack of consensual definitions for the term “social enterprise” and the notion of social value highlighted above. As a concept, WISE offers several advantages: 1. It has a relatively consensual definition; 2. It is considered a representative subset of social enterprises in general and as a population coherent enough to build solid empirical analysis (Marthe Nyssens, 2006); 3. WISEs’ focus on employment, enablement and social integration allow to frame the social value they create around specific outcomes (job retention, skills development, social inclusion, etc.); 4. It is known enough to be used by international organizations such as the United Nations (UN) or the Organisation for Economic Cooperation and Development (OECD). 2 Finally, we will frame our work in a public management context where we will focus our analysis using a new public management (NPM) lens. NPM is outlined by Hood as a doctrine aiming to introduce management methods inspired by the private sector into the public sector in order to gain efficiency and effectiveness. Many authors emphasize impact assessment as an important component of the NPM paradigm, in its search for accrued performance (Broadbent & Laughlin, 2003; Dunn & Miller, 2007; Lapsley, 2009; Radaelli, 2004). In NPM, impact assessment provides the information policy-makers need to make better informed choices. These considerations stress the relevance of our approach and suggest the pertinence of public-focused social impact measurement methods. We will furthermore
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